Published on November 20th, 2017
The telecommunications sector is home to some of the most stable, well-known dividend growth stocks.
This is a trend that is unlikely to pass. The importance of telecommunication services in today’s connected world is hard to overstate – which means that telecommunications stocks likely deserve a spot in your investment portfolio.
With that in mind, we’ve compiled a list of all 138 telecommunications stocks (along with important investing metrics) that you can download below:
Keep reading this article to learn about the merits of investing in the telecommunications sector.
How To Use The Telecommunications Stocks List To Find Investment Ideas
Having an Excel document containing the names, tickers, and financial data for all dividend-paying telecommunications stocks is very powerful.
This document becomes even more useful when combined with a fundamental working knowledge of Microsoft Excel.
With that in mind, this section will demonstrate how to implement two powerful investing screens to the telecommunications stocks list.
The first screen that we’ll implement is for dividend-paying telecommunications stocks with dividend yields above 4%.
Screen 1: High Yield Telecommunications Stocks
Step 1: Download the telecommunications stocks list at the link above.
Step 2: Click on the filter icon at the top of the dividend yield column, as shown below.
Step 3: Change the filter setting to “Greater Than” and input 0.04 into the field beside it, as shown below.
The remaining stocks in this spreadsheet are dividend-paying telecommunications stocks with dividend yields above 4%.
The next investing screen that we’ll demonstrate is for dividend-paying telecommunications stocks with market capitalizations above $20 billion and betas below 1.2.
Screen 2: Large Market Capitalization, Low Beta
Step 1: Download the telecommunications stocks list at the link above.
Step 2: Click on the filter icon at the top of the market capitalization column, as shown below.
Step 3: Change the filter setting to “Greater Than” and input 20000 into the field beside it. Note that since market capitalization is measured in millions of dollars in this spreadsheet, filtering for telecommunications stocks with market capitalizations above “$20,000 million” is equivalent to screening for stocks with market capitalizations above $20 billion.
Step 4: Exit out of this filter window by clicking the exit button (not the “Clear Filter” button). Then, click on the filter icon at the top of the beta column, as shown below.
Step 5: Change the filter setting to “Less Than” and input 1.2 into the field beside it, as shown below.
The remaining stocks in this spreadsheet are dividend-paying telecommunications stocks with market capitalizations above $20 billion and betas below 1.2. These are large companies with relatively little volatility, which will appeal to conservative investors (such as retirees).
You now have a thorough understanding of how to make the most of the telecommunications stocks list.
The remainder of this article will discuss the merits of investing in dividend-paying telecommunications companies.
Why Invest In Telecommunications Stocks
There are two major components to a successful dividend investing strategy:
- Dividend yield
- Dividend growth
Fortunately, each component is well-represented within the telecommunications sector.
For evidence, look no further than Dividend Aristocrat AT&T (T). With 34 years of consecutive dividend increases, AT&T has shown its ability to raise its dividend year in and year out.
Source: YCharts
Importantly, AT&T also has a very high dividend yield currently. The company is trading at a dividend yield of 5.7% at the time of this writing. For context, the S&P 500 is currently trading at a dividend yield of 1.9%, which means AT&T generates nearly three times as much dividend income as an investment in a diversified basket of U.S. businesses.
AT&T is not alone. There are many other attractive names within the telecommunications industry. This implies that the industry has some attractive economic characteristics that benefit most – if not all – participants.
This is indeed the case. There are of number of fundamental factors that seem to imply the telecommunications industry is designed to benefit entrenched players.
The first is the high degree of regulation that telecommunication businesses are exposed to. U.S. telecoms are expected to comply with a number of regional and federal regulators, including:
- The Federal Communications Commission
- Cellular Telecommunications Industry Association (CTIA)
- National Cable and Telecommunications Association
Existing players have the expertise and financial strength to meet the compliance requirements of these regulatory bodies, while these same external forces will meaningfully discourage potential competitors. This benefits large telecom companies like AT&T.
Another factor that benefits current telecommunications leaders is the capital intensity of the industry. Unlike other sectors – notably technology – a telecommunications company cannot be simply created out of thin air.
Instead, a significant capital outlay must occur to build wireless telecommunications infrastructure, hire support staff, and invest in overall network connectivity. This makes the fixed asset networks of existing telecommunications companies even more powerful.
Lastly, telecommunications companies tend to trade at persistently low valuation multiples through most economic cycles. This benefits investors in two ways:
- Telecommunications companies tend to have above-average dividend yields due to their below-average valuation multiples.
- Telecommunications companies tend to decline less than the broader stock market (as measured by the S&P 500) during recessions.
With all this said, though, telecommunications companies are not generally fast-growing businesses. Instead, they should be seen as a source of stability and dividend yield within your investment portfolio.
Final Thoughts
The power of investing in telecommunications stocks is hard to overstate. Indeed, these companies have become essential in today’s highly-connected world.
With that said, the telecommunications sector is not the only place where high-quality investments are waiting to be found. If you’re willing to venture outside of this attractive sector, the following databases contain some of the most high-quality dividend growth stocks in our investment universe:
- The Dividend Aristocrats List: dividend stocks with 25+ years of consecutive dividend increases.
- The Dividend Achievers List: dividend stocks with 10+ years of consecutive dividend increases.
- The Dividend Kings: dividend stocks with 50+ years of consecutive dividend increases.
- Blue Chip Stocks List: dividend stocks with 3%+ dividend yields and 100+ year operating histories.
